LONDON: Copper prices retreated on Friday as focus switched to US President Donald Trump’s July 9 deadline when sweeping tariffs take effect on countries that have not yet secured trade agreements.
Benchmark copper on the London Metal Exchange (LME) was down 0.8% at $9,880 a metric ton in official open-outcry trading, having hit a three-month high of $10,020.5 a ton earlier this week.
Volumes were subdued due to the July 4 Independence Day holiday in the United States, traders said.
Trump said his administration will begin sending letters later on Friday to 10 to 12 countries informing them of the tariff rate their products will face in the US Caution due to several large trading partners, including the European Union, Japan and India, still trying to negotiate a deal with the US had triggered profit-taking on long positions or bets on higher prices, traders said.
On the technical front, first support for copper, used in power and construction, comes in at the 21-day moving average around $9,762. Elsewhere, worries about aluminium supplies on the LME created by large holdings of warrants and nearby contracts receded due to slowing outflows and deliveries to the LME-registered warehouses. Aluminium stocks in LME warehouses have climbed 27,025 tons to 363,925 tons since June 25. Cancelled warrants or metal earmarked for delivery at 2% indicate only small amounts are due to be delivered out.
Overall, a softer dollar was providing some support for industrial metals on Friday. But traders said growing prospects of the Federal Reserve holding interest rates steady after Thursday’s strong jobs report could boost the US currency and weigh on metals demand. Aluminium was down 0.6% at $2,590.5 a ton in official activity, zinc fell 0.5% to $2,736, lead eased 0.1% to $2,062, tin retreated 0.3% to $33,750 and nickel slipped 0.9% to $15,315.